microtransactions

MOG subscriptions down, in-game purchases up

Since multiplayer online games like World of Warcraft first rose to pop culture prominence, subscription fees have fueled the revenue stream for developers. Now, a new report from market researcher iSuppli suggests microtransactions will drive industry growth in years to come.

Basically, fewer new players are signing up to play MOGs, the report says, but those who are playing are dropping their money on add-ons and other in-game enhancements.

The iSuppli analysis reports that subscriber revenue in the combined North American and European markets for PC massively multiplayer online games (MMOGs) and standard MOGs declined for the first time ever in 2010--piling up $1.58 billion in 2010, down 5 percent from $1.66 billion in 2009.

That decline seems even more dramatic when compared with the 10 percent annual growth in 2009 and the 21.6 percent increase in 2008. IHS did the math and speculates that the subscription market will decrease on an annual basis through the year 2015, when revenue will shrink away to $1.33 billion. … Read more

How age impacts social-gaming monetization

New data released by Gambit, a micro-transaction platform provider, illustrates the complexity of both customer targeting and analyzing micro-transaction buying patterns. The major takeaway: older players seem like a good target market until you dig in to find out that they don't spend a whole lot.

But, it takes a minute to understand the data, as Gambit's Susan Su points out in a blog post on how age impacts social-gaming monetization. While it would appear that older users are a good target market thanks to their high revenue-per-user statistic, they are actually pretty meaningless in terms of revenue. … Read more

Mochi Media bets big on micro-transactions

There are many differences between the console games we all know and see commercials for, and online Flash games we all play for a bit when we're bored.

According to Mochi Media co-founder Jameson Hsu, the big difference between Flash and console games is quality--of graphics, service, and general game-play.

But as Flash games become more sophisticated and interactive, and business models emerge that take advantage of the low development costs of the platform, the line of delineation between the two mediums is beginning to close.

ComScore released a study a few weeks back that showed the U.S. audience for online games grew 22 percent since last year to 87 million visitors this past May. By comparison, console game sales plummeted 31 percent in June from the previous year.

This shows that there is a huge market there that has big numbers in terms of users and time spent that can now inject serious cash via micro-transactions.

Mochi Media is launching Mochi Coins on Tuesday, a micro-transaction platform that allows developers and game portals to make real money off quality Flash games. Mochi Coins lets gamers sign in through their Facebook accounts and buy game upgrades (weapons, level unlocks, etc.) directly through the game by PayPal, credit card, or marketing offer. … Read more

MMPORGs, microtransactions, and user experience

Microtransactions within online games and social networks offer one possible way to place a value on services while enhancing the experience for users. In addition to online games like Maple Story, virtual goods are launching all over social-networking sites, including Thursday's launch of PlaySpan's marketplace on Facebook and MySpace.

Funding for virtual worlds has grown dramatically over the last year and companies need to find sustainable revenue models. Transactions of virtual goods allow for new cash flow into both subscription and nonsubscription sites.

But some users don't like the idea that you can simply buy something to affect the game in your favor. Accordingly, games need to be very clear about the purchased goods unfold into the game.

The team at Champions Online have outlined how microtransactions will surface in the game in their State of the Game blog post. … Read more

PlaySpan lands $16.8 million in funding

PlaySpan, a company that specializes in digital microtransactions and payment services, announced on Tuesday that it raised $16.8 million in Series B funding from Easton Capital Group, Menlo Ventures, Novel TMT Ventures, STIC Investments, and other undisclosed investors.

According to the company, the new funding will be used to expand its operation into Europe and Asia, which company executives believe are untapped markets that offer growth potential for PlaySpan.

"Online-game publishers and social-media application developers are looking for new sources of revenue beyond traditional advertising and subscriptions," Karl Mehta, founder and CEO of PlaySpan, said in a … Read more